As 2019 begins, EPA has handed out nearly 50 Small Refinery Exemptions like trick-or-treat candy and ethanol RINs have collapsed to around the 10-cent mark, advocated by Sen. Ted Cruz (R-Texas). This is our cold, hard reality today: RINs losing more than 80 percent of their value, ethanol prices flirting with record lows and profitability evaporating because supply outweighs demand.

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In addition to seeing a legally defensible RVP rule through to the end, and likely having to defend it in court, we will keep EPA’s feet to the fire on SREs and insist upon reallocation of the waived gallons.

Speaking of court, the litigation ACE and others initiated on SREs and restoration of the waived gallons will pick up speed in the new year. It is insulting to rural America that farmers and ethanol producers are suffering real economic harm while refiners like Chevron and CVR enjoy record profits and are allowed by EPA to keep the RINs through the waivers. Lawsuits are never the preferred approach but sometimes EPA action (or inaction) leaves us with no other choice. Recall we were forced to sue former President Barack Obama’s EPA when it waived 500 million gallons from the Renewable Fuel Standard based on so-called blend wall constraints. We prevailed in this case and are still waiting for EPA to reveal how it plans to restore this lost demand volume.

In 2019, ACE will also carefully examine the changes EPA will propose for RIN trading, as part of the RVP rule-making, to make sure blenders and retailers are still able to use RINs to help them market higher ethanol blends.

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Because ethanol is a bipartisan issue, it doesn’t really matter to us who controls Congress, but that won’t stop oil refiners and individual lawmakers from introducing legislation to repeal or reform the RFS.

In fact, two House Republicans unveiled “discussion draft” legislative language around Thanksgiving that would establish a minimum 95 research octane number (RON) fuel requirement in exchange for grave changes to the RFS, including sunsetting of volume obligations, overturning emissions anti-backsliding requirements, and gutting market access provisions for cellulosic and advanced biofuels. There are certain ideas in this legislative draft that, in isolation, might help ethanol. But the net effect of the entire legislative package would be very harmful to the ethanol industry and farmers.

Other priorities we will tackle in 2019 include export promotion, the RFS reset rule-making, and increasing ethanol demand through meaningful and thoughtful low-carbon and high-octane policies. Of course, ACE will continue working alongside retailers to expand the use of E15, E85 and midlevel blends. READ MORE